The Alabama Legislature had a busy second week to the session, meeting three days during the week. The legislature has now met five of the possible 30 days of the session. Several bills of interest to the concrete industry were introduced last week, but two stand out above the rest.
House Bill 268 by Representative Steve Clouse, (R) Ozark would increase the sales tax on automobiles and trucks from the current rate of 2% to 3%. The legislation was proposed by the Governor during the state of the union as a method to close the shortfall in the General Fund Budget. The Governor’s original proposal was a 4% increase, but Representative Clouse was quoted on al.com stating the increase was too great.
“I just didn’t see any support for an increase of 2 percent at one time like that,” said Clouse, who is chairman of the House General Fund committee, which will handle most of the tax bills.
The bill also removes tractor trailers from the tax increase if the owner can provide documentation that the trailer is used in interstate commerce. The legislation would result in an additional tax burden of approximately $100,000 on the concrete industry based on ready mix truck purchases. The ACIA is working with the Automobile Dealers Association to oppose the legislation.
House Bill 275 by Representative Mark Tuggle, (R) Alexander City would allow a construction manager at risk option for publically funding projects in the state and create a design build mechanism on state projects. Currently, Alabama publically funded projects are selected based on lowest bid. Passage of this bill would allow contractors to be selected based on qualifications. In addition, the selected contractor could then prequalify sub-contractors on the projects. House Bill 275 is the top legislative agenda item for AGC and ABC of Alabama. Passage of the legislation should not negatively affect the concrete industry, but the bill could create a scenario where a ready mix company is locked out of bidding on a project based on prequalification by the general contractor.
The legislation is receiving heavy pushback from small contractors in the state who argue the bill is a means for large Birmingham based general contractors to lock smaller contractors out of state work.
On Friday, the Montgomery Advertiser ran an ARTICLE on the legislation.
House Bill 275 is schedule for a committee meeting on Wednesday, March 18, 2015. A public hearing has been called to debate the legislation.
Bills referenced last week in the report
House Bill 142 by Representative Mike Hill, (R) Columbiana would require combined income reporting for corporations that do business in other states. House Bill 142 did not move this week. The legislation is awaiting review by the Ways and Means General Fund Committee.
If you have any questions or comments regarding this report, please contact the ACIA.